"Notably, shares of ASML ( NASDAQ:ASML) look like a great catch-up trade for investors who want a massive beneficiary without having to pay as high a premium. Of course, the stock has already gone parabolic, gaining about 80% in just the past year. With 17% of the gains coming year to date, though, the shares are seemingly going vertical, as the photolithography machinery (it's necessary for making the latest and greatest AI chips) orders come in hot."
"Undoubtedly, demand seems to be off the charts for AI chips, and that's finding its way down to the equipment makers themselves. With a virtual monopoly over lithography machines, it's the only game in town for a lot of fabs. And while the past-year run has been magnificent, many analysts see more upside for the firm as the wave of AI looks to lift it significantly higher. The stock might be hot, but it's not nearly as hot as its peers."
Unprecedented AI demand and aggressive AI data center builds are driving fabs to expand capacity. The iShares Semiconductor ETF ( NASDAQ:SOXX) has surged more than 9% so far in 2026. Memory chip shortages are elevating data storage firms while cyclical semiconductor-equipment makers participate in the boom. Fear of missing out may prompt investors to re-enter previously sold names after recent choppiness. ASML benefits from accelerating photolithography machinery orders and holds a near-monopoly position in lithography equipment. ASML stock has gained about 80% over the past year with 17% year-to-date, and analysts see additional upside as AI demand continues.
Read at 24/7 Wall St.
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